India’s Energy Storage Milestone: 500 MW/1,000 MWh BESS Auction Concludes in Tamil Nadu
- RE Society of India RESI
- Jun 25
- 3 min read
In a major stride for India’s energy storage landscape, Tamil Nadu Green Energy Corporation Ltd (TNGECL) has concluded a 500 MW/1,000 MWh standalone Battery Energy Storage System (BESS) auction. Bids were won by NLC India Renewables Ltd (NIRL, a subsidiary of NLCIL), Bondada Engineering, and Oriana Power, selected through a tariff-based Build-Own-Operate (BOO) model following a March 2025 tender.
Award Breakdown & Tariffs
Under the recently concluded 500 MW/1,000 MWh Battery Energy Storage System (BESS) auction by Tamil Nadu Green Energy Corporation Limited (TNGECL), three developers—NLC India Renewables Limited (NIRL), Bondada Engineering Limited, and Oriana Power—secured projects based on a tariff-based competitive bidding process. NIRL had a capacity of 250 MW/500 MWh at a tariff of ₹248,000 per MW per month (approximately USD 2,880/MW-month). The secured systems will be installed across three substations—Ottapidaram, Anuppankulam, and Kayathar—where they will be connected to 400 kV grid infrastructure. The design configuration includes modular blocks of 100 MW/200 MWh, each capable of delivering a 2-hour continuous discharge, aimed at providing grid support during peak demand and renewable integration hours.
Bondada Engineering Limited secured 200 MW/400 MWh capacity at a slightly lower tariff of ₹246,000 per MW per month (approximately USD 2,857/MW-month). These systems will be deployed at the Vellalaviduthi and Thennampatty substations and connected to the 230 kV grid. Each installation will consist of 100 MW/200 MWh blocks, maintaining a discharge duration of 2 hours to provide firming and peak-shaving capabilities. Similarly, Oriana Power won a 50 MW/100 MWh project, quoting the same tariff as Bondada. Their system will be installed at the Karaikudi substation and connected to a 110 kV grid, making it suitable for localized grid balancing and backup.
All systems under this tender are designed for a 2-hour rated discharge, adhering to a minimum C-rate of 0.5, which means they can fully charge and discharge within two hours. These systems are required to meet a round-trip AC-to-AC efficiency threshold of at least 85% on a monthly basis, ensuring minimal energy loss during operation. Moreover, they must maintain at least 95% annual availability, ensuring high reliability for grid dispatch. The State Load Dispatch Centre (SLDC) will control real-time operation and dispatch of these systems, while charging will be carried out through Tamil Nadu’s distribution utility infrastructure.
A notable support mechanism in this auction is the provision of land by the Tamil Nadu Transmission Corporation at a nominal lease rate of ₹1 per year, significantly reducing infrastructure costs. The project developers will benefit from capital cost incentives under the central Viability Gap Funding (VGF) scheme, which subsidizes up to ₹2.7 million/MWh or 30% of the project cost—whichever is lower. This initiative marks a significant step in strengthening Tamil Nadu’s energy storage backbone and provides a model framework for future state-led BESS procurements in India.
Outlook & Comparisons
This auction marks significant headway in India’s BESS deployment, particularly under state-led schemes. With more stringent technical norms and attractive VGF support, it sets a precedent for future competitive auctions. Lower tariffs in Rajasthan illustrate the potential for further cost efficiencies via scale, volume procurement, and technology improvements.
TNGECL’s 500 MW/1,000 MWh BESS auction represents a forward leap in battery storage adoption within Tamil Nadu and India at large. With rigorous technical specs, balanced tariffs, and supportive policy framework, it sets a benchmark for integrating intermittent renewables and fortifying the grid. Execution within the next 18 months will be pivotal in shaping India’s transition to a more resilient, storage-enabled energy future.
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